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tv   Mad Money  CNBC  May 16, 2012 6:00pm-7:00pm EDT

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buy fedex. >> see you tomorrow night for squawk on the street and back here at 5:00. more fast money that will be covering the facebook pricing here at cnbc. i'm jim cramer, and welcome to my world. you need to get in the game! going out of business and he's nuts! they're nuts! they know nothing! >> i always like to say there's a bull market somewhere. "mad money." you can't afford to miss it. hey, i'm cramer. welcome to "mad money." welcome to cramerica. i'm just trying to save you a little money. my job is not just to entertain you're welcome but i'm trying to educate and teach tonight, so call me at 1-800-743-cnbc. with the dow jones average barely positive for the year, down ten of the last 12 days, a miserable period, with visions of previous spring swoons
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dancing in our heads. it might be worth it to take a moment to figure out which stocks in the dow jones average could take us down further and whether it's reasonable to expect that they will. it's certainly worth pondering on still one more not so hot day, dow down, nasdaq declined .68%. what we fear, obviously, is the thousand-point bruising we got from the dow -- dow, 10,700. and the hideous may until october nighlation that 2011 brought us. the worries are justified. europe is in collapse mode led by the modern day runs at the bank by greeks. if that happens, spain and italy will not be far behind. although our industrial production numbers this morning were robust and our foreclosure applications are the lowest in four years, europe is reluck and thely, i say it, back in the
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driver's seat with nothing good that i can see happening, at least for now. so with that hideous backdrop, i've got to ask who can do the most damage in the dow from here? what stocks would take the averages down another 10%? the big fear out here on top of the 700-odd points we've already fallen, who for the purposes of this analysis -- i'm going use this word repeatedly because i need you to focus on it -- >> vulnerable to a big decline? first would have to be the oils. exxon and chevron are down 3% and 6% respectively. while chevron at least gives you 3.6% yield, exxon's 2.7% yield doesn't mean jack. this group verges on freefall pretty much every day. i don't see it stopping any time soon because we seem to be replaying last year's decline. the good news, though, is that even through the lens of 2011, chevron only sold down to 90. it's 100 now. the bad news is that exxon hit $67. i think chevron could bang us until it hits 4%. still a little ways from now. but exxon, which reported a disappointing quarter, could
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decline 7% or 8% fairly easily. call exxon vulnerable. a resource related portion of the dow. you can't help but wonder if caterpillar isn't going to be crushed from here. could it go down to 70 from last year? give the comments about the slowdown in commodity capital equipment spending, i'm saying that $70 is not off the table, and a move to 80 from its 91 and change perch is probably likely given the lack of dividend support. call caterpillar extremely vulnerable. the other industrials, they're on slightly firmer footing. united technology reported a pretty good quarter. they can be taken down given their less than 3% yields, but their businesses are diversified and strong. they have europe, yet also some secular positives. some vulnerable for certain, but not anything totally hideous. as for dupont, the company missed its protections last year, but has much more going
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for it right now, auto exposure, 15 million cars being built, all of which are going their way now. throw in that 3.5% yield and dupont is not all that vulnerable to a severe selloff. general electric, 49% owner of this company got boosted just today thanks to a big dividend from its finance arm. that makes a nice bump-up more likely in the future. g.e. very minor vulnerability. not koa. it has taken drastic action to bring its cost down. i've got to wonder, though, despite their total commodity orientation, it doesn't get saved by auto build. let's say it's somewhat vulnerable. the retailers are suddenly resilient. if they haven't hit more off this mexican scandal, i don't see much vulnerability going forward. after going through home depot's conference call last night, i was shocked to see that stock
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went down as much yesterday at all. of course, it's snapping right back. by the way, both walmart and home depot seem inoculated against europe by their largely domestic exposure. speaking of just reporting, disney put up monster good numbers. a new multi-billion-dollar brand. avengers didn't even exist 21 days ago. robust theme parks and ad rates, disney has to be twouchb most vulnerable stocks in the dousm it's getting a huge tail wind from lower gas prices. the recession the one from benefit from the commodity collapse. not only are they not vulnerable, they seem to be actually in a position to go up on european weakness, despite the strong dollar. procter & gamble, johnson & johnson, fizer all look like they are buys right now. perhaps they are invulnerable for now. you can follow along. in order to get ahead of craft split into two companies, because both are huge winners. so is coca-cola where truck
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fuel, packaging, and grain costs are coming down because of the strong dlampl not all that vulnerable. not even positive. tech could be worrisome, but i'm not particularly troubled. at least within the dow tech. right now, intel is coming out with a new line of chip. given that both had extremely strong quarters, i would be a buyer of either one of them as they go down. the verdict not vulnerable, possibly positive. as for cisco, hey, it's already been crushed. how about was vulnerable. hewlitt packard is awful and can can lower. but with 22 bucks, the downside seems fathomable. another member was vulnerable, ibm presents a real risk. the dow is a silly, weighted index. on the other hand, the huge buyback is the actual earnings. i call it somewhat vulnerable. jp morgan feels like cisco to me. it's now much less vulnerable because of its big swoon. that swoon has crushed bank of
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america, too. still up 28% for the year, looks like a stock that's worth buying at seven bucks, and boy, they're really improving the balance sheet for the day. charitable trust just sold american express, had a big gain. quarter was terrific, though. travelers also reported a fantastic quarter and has showed no degradation during the selloff. i called express selloff from 64 to 67. at&t and verizon, i know they've run gigantically, yet i don't know a soul who doesn't want in, given their totally domestic businesses with remarkably wireless grusm they are not particularly vulnerable. as a matter of fact, i want to buy at&t for my charitable trust down the point. verizon seems pretty good, which leaves two stocks that have fallen, but also have cast lists, which could halt the declines here, boeing and mcdonald's. i think boeing is going to show big share gains against air bus. mcdonald's is already down a lot. i think it's factoring in a real slowdown in numbers that might not even happen. commodity costs are going down, down, down for them, and the
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dividends terrific. limited vulnerable to both. the venerable index, could take it down to even or maybe slightly below for the year. seems better with very few stocks on the vulnerable list and many more on the hope they come down so i can buy them list, he's the bottom line. a decline in the dow of several percentage points wouldn't shock me from these levels, but a big collapse, that's harder for me to swallow without a total collapse in europe. unfortunately, that's not beyond the realm of possibility, so we have to stay vigilant and avoid the vulnerables no matter what. bill in illinois. bill? >> caller: yes, sir. >> what's up? >> caller: i have a question. gm stock, about a month ago or so, when it was at an all-time low, why didn't more people jump onboard and what do you think that this interest that berkshire hathaway has shown? >> i think the berkshire
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hathaway effect was present today. not very lever to the resurgence of the japanese auto companies and they don't have their cost structure down. warren buffett is out there making a valuation bet. he can do that because he can wait forever. if i were to recommend gm right here, believe me, i think what you would say is oh, jeez what have you done for me lately? meaning nothing. josh in wisconsin. josh? >> caller: hey, big daddy, cramer, big trucker boo-yah to you. >> josh, man, thanks for calling in. what's up? >> caller: well, with everything unraveling again in europe with greece and all that, what do we do with the dollar going up and the euro going down? >> what we have to do is pick companies that are not that levered to the dollar or that have such great franchises that they can raise price to offset the dollar. i do believe the dollar is going to keep going higher. i think the currency is not as important as being able to raise
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price. the stocks that i like are able to raise price and do well in a slowing environment. pat in california. pat? >> caller: hey, jim, how you doing? >> real good. how about you, pat? >> caller: i'm great. here's a big jim plunkett should be in the hall of fame boo-yah for you. >> yeah, definitely, boo-yah. jeez. >> caller: anyway, i want to talk to you by orashire. the company got fda approval yesterday. they test for more than hiv. they have great future in health applications, immigration, law enforcement, prisons, and corporate hr. do you have any thoughts? >> yeah. after arena, which was expecting to quadruple, i am reluck about the -- reluctant to tell you not to buy orashire. a slide in the dow several percentage points would not shock me. we are not isolated. but the key is to find the
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company which are vulnerable and which aren't and i just outlined the true vulnerabilities. "mad money" will be right back. >> coming up, commodity conundrum. global growth concerns are crushing commodities. but could the collapse be your opportunity to cash in? cramer is going "off the charts" to find out. and later, social studies. the facebook notifications keep rolling in. but don't get overwhelmed. cramer's got you covered. with this giant size social offering still expanding, jim stocks up the shares against the rest of its social circle. could his comments help you change your status? all coming up on "mad money." miss out on some "mad money"? get your "mad money" text alert today. text mm to 26221 to get cramer right on your phone. for more info, visit
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madmoney.cnbc.com. or give us a call at 1-800-743-cnbc.
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you know me. i like to be constructive. accentuate the positive, eliminate the negative, that sort of thing. you won't get very far in the stock market just by taking your cue from johnny mercer songs. sometimes it's just as important to lay out all the stocks you need to stay the heck away from. >> sell, sell, sell. >> that's why tonight we're doing a very special "off the charts" version of the sell block with the help of carolyn brodin. we've got to show you how dangerous the commodities stocks can be in this environment, and they are dangerous. just because they've already been crushed by the commodity collapse doesn't mean, as we've learned before, they can't be crushed some more. i may not be a chart guy. i'm fundamentalist, meaning someone who doesn't put much stock in the charts and instead
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focus on how the underlying fundamentals are doing. when the trend is not your friend, when it is your worst enemy, and no surprise, based on brodin's worth, that's the case right now. the vast majority of all commodity-based stocks, even some that i consider best. there may be some areas they can bounce, but for now, brodin says the path of least resistance calls for lower prices. as you will 1993 a moment, these stocks are all pretty much tracking together as if they were one stock. let's start with slummer jack, s.o.b. the oil services titan is the best in the business. doesn't matter right now. nothing will save this one from the plummeting price of oil and the stock's hideous chart. it's been making a clear pattern of lower highs. and lower lows, which of course is a classic evidence of a true
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downturn. slob, as we call it on wall street, is now below its 50-day, and its two-hundred day moving average, kiss of death, because it has deteriorated on a short-term and long-term basis. worst of all, from brodin's perspective on the first day of may, tried and failed to breakthrough. and then went right back down. what makes that level so important? brodin is a designal of a medieval mathematician that discovered a series of ratios that repeat endlessly in nature, well documented. turns out, they exist in the stock market as well. those are the key fibonacci ratios. i can't explain it.
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it happens often enough for numerous technicians to make money using this strategy, so i cannot regard it as being mumbo jumbo. it works too often. it was making a 61.8 retracement back to a crucial high made in february of last year. maybe it's self-fulfilling, but b bingo, that's where you had to sell it. so now what happens? slls schlumberger can bounce back from where it failed before, then brodin sees it sinking ever further. based on her projection, she believes it could fall all the way do $47.72. you know what that is? that's a 26% decline from those levels. even though it's already been hammered and obliterated, brodin thinks it's a fallen knife that could go much lower.
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this is the butcher block that you would be in if you played along. can't have you be a butcher block. you can see the same thing in another great company. this is the chart of apache. it's another very well-run company, among the strongest explorers for gas. the envy of the industry, people. apache is like a good house in an awful neighborhood. brodin's read on the chart is just like slob, apache has made a pattern of lower highs, lower lows. you see that pattern? that is just a nightmare. again, it is below the 50-day and the two-hundred day averages. brodin thinks there's nothing stopping it from going a lot lower.
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20 points of downside here, with it possibly dropping even further down to $51. 31-point decline for the best -- maybe one of the best independent oil and gas companies in the world. now check out the best major growth oil. this is occidental petroleum. at $79, they are already 30 points off its 52. hey, listen, i got to start buying somewhere. no! brodin thinks it could fall another 24 points at least, and then possibly go as low as 41. that would be a massive 48% decline! doesn't matter that this company is some of the best oil share holdings on earth in california. doesn't matter that this is a really valuable company. it's the same chart as the others. it's not just the oil patch. take a gander at another company
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i like so much. this is joy global. no joy in global. this is the mining machinery maker that gets the lion's share of its sales from coal. joy has fallen off a cliff. already down a cool 40 points from its 52-week high. brodin believes joy could fall another 11 to $14 from here. it did go much lower during the 2008 period. speaking of 2008, there's freeport, the huge miner of copper and gold. just like all the other commodity-related charts, freeport has been making higher highs and lower lows. the stock is well beneath its 50-day and 200-day moving averages. even though it's fallen a staggering percent, brodin thinks it has a ways to keep falling. it not stop until it hits 24 or
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23. remember this one bottomed at 17 when it got rid of the dividend. i just don't think things are that bad. but remember, this is not my view. i'm showing you a chart because the people who trade these stocks are really working right off the charts. o brodin would change her mind on any of these stocks if they were to rebound dramatically from these levels. that's always a possibility if greece got its act together, because it's certainly not because of u.s. industrial production, which is very strong. for now, the charts say these commodity names are headed a lot lower and that's a pretty darn good reason to stay the heck away, even though i think there's tremendous value. i can't tell you to buy these stocks now. here's the bottom line. this is not the time to try bottom fishing in the commodity games. occidental, apache, joy global, freeport, they have a lot further to fall. my view, i say why bother with these commodity plays at all when the charts and the
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underlying commodity prices are against you? there are so many other easier nonbattleground ways to make money, even in this difficult market, especially the companies that buy the raw commodities from these companies to make their products. the commodity, they're a slaughterhouse. and slaughterhouses stink. after the break, i'll try to save you even more money. coming up, social studies. the facebook notifications keep rolling in. but don't get overwhelmed. cramer's got you covered. with this giant-sized social offering still expanding, jim stacks up the shares against the rest of its social circle. could his comments help you change your status? [ male announcer ] at scottrade,
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everybody is talking about facebook, which is expected to come public with a bang on friday. we tell you what to do about ipos. we try to tell you where they should be priced, where they should be bought, and often the most important, where they should be sold. for weeks, i've been telling you if you can get in on the facebook deal, you should try to get as many shares as possible something that i reiterated again on monday. >> buy, buy, buy! >> but if you can't get on the
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actual ipo, like i told you last night, you absolutely must not, not buy facebook in the aftermarket, especially not during its first day of trading on friday. this is so important that i'm repeating it again tonight. buying on the first day is almost always a boneheaded move. >> the house of pain! >> and it's been a mistake with every single -- every single social media ipo we've seen so far. if you put a market order in to buy facebook at the opening, shame on you. you deserve your own fate. but with all the hoopla over facebook, maybe it's time for a reality check. is the recent wave of social media ipos mere lay repeat of the hideous horrible money losing dot-com bubble? are we making the same mistakes all over again? is the tremendous amount of excitement over facebook irrational exuberance? i've told you not to buy the stock on friday, but maybe you shouldn't buy it at all. no, no, no, and no. when you look at the facts, facebook isn't the epitome of
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a.com era mindset that lost people fortunes. it's a tremendous company that made people tremendous growth. eyeballs, the old stupid metric that got people in so much trouble the last time around. you could analyze the stock by the numbers. you don't have to be an ophthalmologist to count how real the eyeballs are. facebook can be a great investment if you get it at the right price. that's core valuation analysis. it's more important than the huge number of shares are that everyone's yapping about, or the fact that there are a ton of insider sellers. of course, yeah, sure, i'd like to see no insider stock, but come on, at that point, that's a distraction. why am i so confident the anti-facebook bubble heads will be wrong? first of all, people might be excited about all the latest social media ipos, but what's happening now is nothing like the instanty that gripped the market in 1999. unlike a lot of the scholars out there, i can actually remember
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the dot-com era, i lived through it like almost no one else. i founded an internet company that went private. i watched it strike on the first day and spend years crashing and burning before it bottomed at a dollar. yes. stocks can't go below zero. so i'm more qualified than just about anybody else in this country to make this judgment. facebook is a legitimate company. in fact, it's too legit to quit. in 1999, we had 289 internet related ipos, and that's an order of magnitude bigger than what we're seeing now. that is a mania. in 1999, the internet related deals accounted for 60% of all ipos and the average spiked 90% on its day. that is a mania. those numbers are both way bigger than what's happening epa now. just as important in the original dot-com bubble, there were a handful of companies that went on to thrive, like amazon. if there's any truth at all to the comparisons, i'm betting
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that facebook is going to turn out to be one of few survivors. just consider, facebook is in a league of its own compared to every single other social media play we've seen, and that's why it's expected that it will dwarf all the rest. i'm not daunted by $100 billion market cap like so many people are. in the last quarter, facebook generated over a billion in revenues. you know how hard that is to do? not only is facebook profitable, earning 43 cents a share, but i can see the expectations of making two bucks in 2015 are realistic. if they execute right, could be more like $4, and these guys are cracker jack executioners. of the other social media plays, groupon -- facebook has 901 monthly active users, that leaves everybody else in the dust. facebook makes more money per
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user, 1.21. only linkedin comes closer. facebook has higher barriers to entry than any business while frankly anybody else in this business. it's a higher barrier entry than google. google plus hasn't been able to chip away at their dominance. you simply can't replicate the wonder and reach of facebook. replication being the key term here. no matter how much money you have, you can't replicate it, which is why the $100 billion valuation does not freak me out. i am not one of these. it is the ability to target advertisements in a way that no one else can. mobile is the big risk here. facebook has only just started to roll out its mobile advertising strategy, but they have a better chance of winning in this area than any of the other social media names. if anyone can devise the str strategy, it will be zuckerberg and company. disney's bob ieger said if an advertiser wants his brand out there in a big way, nothing can
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touch the reach of broadcast tef. but facebook has been a major driver of business for them. i don't think they're make it up. plus, when facebook comes public on friday, it won't even be the most expensive social media stock. there's no telling where it will be once it starts trading, but at the mid point, facebook will be trading at 55 times next year's earnings. linkedin, the most successful social media ipo to date, trades at 90 times next year's earnings and 38 times 2015 earnings, wildly more expepsive than facebook. even if facebook doubles on its first day of trading, it would still be cheaper than linkedin. even loser yelp trades at 33 times 2015 estimates and facebook should definitely be worth more than yelp. yes, i think facebook could be a worthwhile investment. but only if you can get it at the right price. price is what matters and that means being patient, waiting for the initial fervor to subside,
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and only buying it because of a pull back down somewhere along the road. what separates the winners like linkedin from the losers like just about everybody else, but especially groupon and pandora? linkedin has been able to turn a profit. in the latest quarter, it was excellent. linkedin is basically facebook for professionals where people looking for jobs can network with each other. management has also been conservative. it's a chronic underprompt, overdeliver, which has allowed the company to beat the numbers. i think the ast good sign that the one social media play is the one that looks and acts just like facebook. don't forget, though, even with linkedin, off much better chance to buy on the first day of trading. buying the pullback was much smarter than buying the pop. groupon and pandora have been the worst performers since coming public. both groupon and pandora have got the same problem. there's nothing proprietary about them. groupon's local deal models has
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been replicated by everybody. pandora, online radio station, which to me doesn't seem that much different from a normal radio station. neither of these companies has been focused on profitability. facebook has much more in common with linkedin than it does with groupon or pan dor rasm they're making real money. they have an incredible platform. and the company is run by a brilliant visionary ceo. the earnings here are real. here is the bottom line. the facebook ipo is not a sign that we're repeating the mistakes of the dot-com bubble, even though everybody seems to say it. facebook is a fabulous company, much better than any other social media ipo we've seen so far. i think the stock will succeed, like linkedin. however, that doesn't mean you should buy it when it starts trading on friday unless you're in on the deal. if you don't get on the deal, recent history says patience, as painful as that might be -- >> the house of pain! >> will be rewarded. wait for the enthusiasm to subside. i'm willing to bet that the
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market will indeed give you a better price. doug in new york. doug? >> caller: hey, jimmy, how you doing? >> real good, doug. how about you? >> caller: getting a little bit rocked by this market. but i'm taking your advice. 5% to 8% dip opportunities, increasing my position with google last week. helped me out, baby. >> and that google is good. google is regarded as being a high-class facebook, even though i think they're both good companies. how can i help? >> caller: here's my thoughts. i'll get your thoughts. what do you think about google losing some of its ad dollars with facebook, and if there's any potential threatening with the rewrite? what do you think? >> i'm looking at google and facebook like abc and cbs, or nbc and fox. i think there's room for advertisers. there's plenty -- unfortunately, there's a lot of copy, a lot of -- there's a huge amount of volume of pages on the web. but google and facebook are considered to be high quality places to advertise, so there will always be advertisers for both. joyce in texas. joyce?
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hey, joyce. >> caller: hi, jim. i'm so glad you were able to take my call today. my question is on american tower systems, i have owned this stock in the past, but i'm sold out of it. and it went down today, 56. 2. i was wondering if you think i should get back into it. >> let's wait a little. the previous caller, we were talking about the notion of the five day pullback. you don't have that back. american towers is a point or two after its high. i like that company. they are the real deal. they're the attenthat companten. facebook is one of a kind. it's not an expensive stock compared to its peers. if you can get in the ipo, great. we'll talk about it. stay with cramer. almost every day i walk into the office
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and somebody asks me a question about the volt. what really blows them away is when i tell them i almost never go to the gas station, despite the fact that they see me driving to work every day. i fill the volt up once every -- maybe once every couple of months. and that feels absolutely wonderful. i'm hardly using gas, but it's there when i need it. anybody that thinks that this car doesn't have solid performance, hasn't driven it. there's no other car like this on the road. ♪
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it's time! it's time for the lightning round.
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are you ready? lightning round. let's go to jack in tennessee. jack? >> caller: jim, boo-yah, from nashville. >> oh, man! sing to me. >> caller: vhc -- >> the greatest speculative stock of all time, or at least since our show began, number one performer keeps winning a lot of battles. i am going to say that even though it's a lawsuit patent name, it can go higher. trades very radically. rich in south dakota. rich? >> caller: hey, jim. this is rich, transplant from long island, new york, living the dream in south dakota. >> you are living the dream, my friend. you are living it. what's up? >> caller: i bought some energy a couple times this week because i'm not afraid, i'm buying. but my question is about superior energy. spn. it was mentioned on your show a few times in the past and i wanted to see what you thought about it now. >> right now it's in the dog
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house. it's down big for year. i am avoiding commodity stocks for now. there will come to be a better one. let's go to lillian in new york. >> caller: hi, jim. this is lillian with a big boo-yah to you from long island. jim, a while back, you spoke about dob. i bought some for myself and my grandchildren. nothing happened, no movement. about a week ago, there's breaking news, and said that they had bought the naming ri t rights to the kodak building. it was up $6 a share. what's your take on this stock? >> i think it's time to ring the register. the original thesis worked out because when homes were booming, it was about home theaters and sound and movie theaters. now i think it's played out. i want you to take the money and
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run. danielle in nevada. >> caller: hi, how you doing? >> real good, danielle, how about you? >> caller: i love your show. i'm doing good. and you help a little investor like me. >> that's what i want to do. >> caller: i'm doing mgm resorts international and ticker is mgm. >> inexpensive stock. vegas has been down on its luck. i'd rather have you stick with las vegas, lvs. billy? >> caller: boo-yah, brother jim. >> what's shaking? >> caller: this is brother billy bradberry from texas, and i'm calling to honor my father bill senior, who was a huge fan of yours. whose last wish was to lease our 200-acres in parker county. >> he's a successful man. i'm sure led a long and happy life and i'm sure he's got a good life. what's up?
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>> caller: the tex co stock he earned as an executive with quaker oates company. i wanted to know if this would be a good time to sell. >> he had horse sense. i don't want you to sell. i'm not concerned about these ideas of breaking up. it is synergistic to have both on. i am telling you to hold on to that, sir. i think you can see higher prices now that commodities are coming down. wanda in minnesota. wanda? >> caller: hey, jim, how are you? >> i didn't buy the vikings. i had my chance. i didn't do it. >> caller: well, we finally got the new stadium. >> they would have thrown the stadium in too for me. i bet wrong that way. what's up? >> caller: i got a dilemma i hope you can help me with. i invested in a nontraded reach. it's now gone public, mid april, they call themselves retail properties of america. rtai. >> yeah, you know what? we're federal realty believes
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here. we're frt. we're going to say no to that one and yes to federal realty if you want that exposure. and that, ladies and gentlemen is the conclusion of the lightning round! >> the lightning round is sponsored by td ameritrade. you'd spot movement, gather intelligence with minimal collateral damage. but rather than neutralizing enemies in their sleep, you'd be targeting stocks to trade. well, that's what trade architect's heat maps do. they make you a trading assassin. trade architect. td ameritrade's empowering, web-based trading platform. trade commission-free for 60 days, and we'll throw in up to $600 when you open an account. to provide a better benefits package... oahhh! [ male announcer ] it made a big splash with the employees. [ duck yelling ] [ male announcer ] find out more at... [ duck ] aflac! [ male announcer ] ...forbusiness.com. ♪ ha ha! the teacher that comes to mind for me
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is my high school math teacher, dr. gilmore. i mean he could teach. he was there for us, even if we needed him in college. you could call him, you had his phone number. he was just focused on making sure we were gonna be successful. he would never give up on any of us.
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hey, you know me, i like to focus on the positive here at "mad money." my end goal is to help you home gamers make money, no matter what the market is doing. ten out of 12 days, the dow is down, we still got to do it right. there's still plenty of money making opportunities out there, and when picking your stocks, i always like to say diversification is key to staying in the game. that's why we play every wednesday. tweet me@jimcramer. i tell you if your portfolio is diversified enough, or maybe you need to mix it up a little. let's start off with a tweet. am i diversified? apple, intel, fizer, at&t, and waste management. he is from madison, new jersey,
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which is our chief rival. quality drug company in fizer. we've got a tech company with a 3% yield in intel. waste management, another high yielder. at&t, which is a great yielding telephone stock. and we have apple. is apple a conflict with intel? yes. so we're going to get rid of intel. we've got to take that out, as much as we like intel, and what we're going to do is add an industrial. why don't we do dupont? let's go to bob in kansas. bob? >> caller: hey, jim. keep up the good work. i watch your show religiously. >> you're a good man. this is some day, some market. but let's make sense of it. >> caller: my five stops are wft, intc, archer daniels midland, dg, dollar general, t, at&t. >> all right. for a second there, it's like playing with david faber of
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"jeopardy." david will get it right because he's the brain. weatherford, they lost control of their accounting. at&t, high yielding, terrific company. dollar general, that is the cohort that everybody respects right now. intel, tossed it out last time, but i don't see a conflict this time. adm, which is an ag play. ag really soft today. they shot themselves in the foot, as they said they would. bingo! now we're going to adam in minnesota, where i almost bought the vikings. adam? >> caller: hey, jim, how are you? i think the market is kind of taking its cue from our twins here. >> you're right. yeah. well, whatever. but must be tough to be from there right now. go ahead. i met the twins a couple years ago, they're great guys. >> wondering if my top five
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stocks are diversified or if i'm better off betting on twins. american power, meli, nike, nke, waste management, wm, and stat oil, sto. >> i like this because i see people are getting the yield equation. they're trying to protect themselves with the yield. which you know i i think is terrific. let's see what this twin fellow has. stat oil, not a lot of growth, but it's got good yield. nike, fabulous growth stock. we all know that you need antennas. waste management, high yielding industrial. we got a tell co. we got a e.r.retailer. well-played. everyone, congratulations. "mad money" back after the break.
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i'm still reeling from that hideous loss jp penney announced last night. it was a total, unmitigated disaster. this travesty could have been predicted because ron johnson, the new ceo, overpromised and underdelivered big-time. in fact, i did predict it. johnson encouraged people to think the term would be pretty smooth. he came out with guns blazing. now the guns are blazing, all right, but at him. you know what i didn't like? let me koubt count the list. we know the boasting about pure
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hue brings that allowed him to sell $41 a share three days after he hiked it to the moon. how is he doing versus everybody else? where did that go? sure, he did it to pay for his taxes but you pay for taxes a lot of different ways. he cut his holdings almost in half, right at the high. nice call, ron! he gave himself a great price. he won. shareholders, remember them? they lost. but the most nauseating thing about the conference call was the fact that it continues. there was no real humility about the dividend elimination, something older investors most definitely counted on. there was more touting of the changes johnson is putting through, none of which look like they're working. he also said this is not a faraway year. "we expect to earn money this year, good money." where the heck did he get that? how about this one. when johnson said -- sorry. but it's so out of control.
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you got to wonder what's wrong with the guy. he said the turn is 29% complete. huh? like making up a specific sounding precise number somehow adds credibility rather than subtracting from it, especially given how wrong he's been? to me, johnson is both ailuating the old customers and not bringing in the new ones. they're going to macy's and target and just about anywhere else. i visited jp penney and i was appalled at the merchandise. that was obvious to everyone, everyone except johnson, who is only now discovering that old inventory is not his friend. i don't think the brand changes are being executed in a way that works, and 18.9% decline. the sales can't be turned around any time soon. sears, which we all know hasn't been able to turn anything around, never had these kind of hideous numbers, and ous sears, which here's the old catalog, has a much better balance sheet. if johnson has simply said nothing, if he hasn't slaged the
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competition, if he kept expectations low, if he talked about how his everyday pricing strategy would be rolled out ever so slowly to wing them off coupons over time, not cold turkey, then maybe i'd feel better. it's only work fire department one person, johnson. it makes me wonder if johnson had as much to do with the apple stores as i thought when he came over from that terrific company. if i didn't know any better, i think that johnson might have simply been along for the steve jobs ride. i know, 90 days. but his acknowledge that his first quarter performance was, and i quote, "a little tougher than expected." it's the retail understatement of the year. if i were johnson, a simple apology, an acknowledgement of how sorry and humbled he is would have been a much better way to go. stay with cramer. [ mujahid ] there was a little bit of trepidation,
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not quite knowing what the next phase was going to be, you know, because you been, you know, this is what you had been doing. you know, working, working, working, working, working, working. and now you're talking about, well you know, i won't be, and i get the chance to spend more time with my wife and my kids. it's my world. that's my world. ♪ in that time there've been some good days. and some difficult ones. but, through it all, we've persevered, supporting some of the biggest ideas in modern history. so why should our anniversary matter to you? because for 200 years, we've been helping ideas move from ambition to achievement. and the next great idea could be yours. ♪
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and the next great idea could be yours. today is gonna be an important day for us. you ready? we wanna be our brother's keeper. what's number two we wanna do? bring it up to 90 decatherms. how bout ya, joe? let's go ahead and bring it online. attention on site, attention on site. now starting unit nine. some of the world's cleanest gas turbines are now powering some of america's biggest cities. siemens. answers. dave, i've downloaded a virus. yeah. ♪ dave, where are we on the new laptop? it's so slow! i'm calling dave. [ telephone rings ] [ male announcer ] in a small business, technology is all you. that's why you've got us. at the staples pc savings event, for a limited time get up to $200 off select computers. staples. that was easy.
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